Running a global annual compensation review process can be a huge undertaking, involving potentially tens of thousands of employees, thousands of participating managers and hundreds of departments. In order to pull it off successfully, it requires detailed planning and the use of technology to reduce manual effort while ensuring that employees are rewarded correctly.
We at Kainos are experts in designing, implementing and supporting Workday compensation management and review processes for large and small businesses.
The aim of this post is to share some of our experience and lessons learned from previous compensation review cycles.
The following headings represent some of the key areas you will need to address in your preparation for compensation review.
Detailed Preparation Plan
Detailed planning is essential for ensuring that the review can be processed smoothly and that each member of the team understands their roles and the timelines involved. Your preparation plans should include the following elements:
- Agreeing assignees and due dates for each task
- Agreeing monitoring and reporting procedures
- Agreeing procedures for manual intervention
- Data validation and correction activities.
- Full details of the testing, dry run and production launch tasks.
- Entry criteria for the launch of the process, including the review of reference data, completion of employee data updates and defect resolution.
- Communication plan for status updates as well as issue tracking and escalation.
Internal Knowledge Gaps
When the configuration is complete, it is common that some of the process and configuration experts leave or are re-assigned to other projects. This can result in major gaps in internal knowledge for the remaining team.
This highlights the importance of investing in good knowledge transfer sessions to build up the knowledge of the internal BAU team and of the creation of detailed KT documents that can be used as reference guides for reward cycles (and as night time reading for any new team members).
Testing
No matter how confident you are in your configuration team, it is always important to thoroughly test the reward process to make sure it does indeed behave how you would expect and that you understand the impact of any limitations. It is also important for ensuring the reward team is well prepared for the processes they will be responsible for during the cycle. Some key items to test include:
- Procedures for reporting and monitoring
- Procedures for manual intervention
- Process notifications
- Processing of parallel events such as compensation changes or terminations
- End-to-end mini dry runs including all process steps and award types.
- Auto-calculations for guideline award amounts. Be sure to check a good sample population, including multiple countries, employees types and compensation plans.
- Pool calculations
- Managing Bonus Funding
- Security access to awards, both before and after closing the cycle
- Loading of business performance results
- Delegating inboxes and re-assigning tasks
Anything that can go wrong WILL go wrong
Here are a few things we have seen go wrong in previous dry runs Of course, none of these have happened during a production process honest!
Organizational restructuring and recent transfers mean that the most appropriate manager is not the one proposing the awards
Don't plan any major organization changes in the last month before compensation review, unless you want to make life difficult for pretty much every manager in the business! Of course, sometimes this is unavoidable, but if you can avoid them, do.
Workday gives you some flexibility in that it allows you to specify an Organization Snapshot Date that it uses to determine which manager will be proposing the awards. However, inevitably there will be some cases where a new manager is proposing awards for employees that they have barely managed. In these cases, good manager-to-manager communication will be key to ensuring the awards are appropriate.
Incorrect dates entered as part of the launch process
The result would be pay rises happening on the wrong date and bonuses calculated on the wrong salary. Getting these dates wrong could be a disaster.
We woUld recommend that all launch parameters are detailed in the preparation plan and that the actual launch is carried out over a screen share meeting. This will mean more eyes on the screen and will ensure the dates are correct before you take a deep breath and click LAUNCH .
Not including all appropriate Merit, Bonus and Stock plans during the launch
These should all be pre-configured as part of the process template so that it does not add complexity or risk to the launch itself. The process template should be subject to multiple reviews to ensure nothing is missed.
Award proposals not completed in a timely basis
This can happen for a variety of reasons such as staff leaving the company or even some managers going on holiday without their laptops...how selfish!
The solution is typically to delegate the Propose Employee Merit Award task on the manager's inbox, reassign the task to another manager (or chase the current manager with a hefty wooden stick)
Award guidelines calculated incorrectly
Despite the great effort that goes into configuring and testing the compensation review processes, there are typically some individual cases for which awards are not calculated appropriately. This can be due to unique scenarios that were not anticipated or catered for in the requirements, or it could be due to incorrect current or historical compensation data. Either way, there are a few options for resolving these:
- Inform the manager of the discrepancy and ensure they manually set an appropriate award.
- Remove the employee(s) from the review process and handle via a Request Compensation Change data load.
- Add a 'hotfix" to the configuration to cater for the new scenarios. This is only a good option if there are a significant number of employees affected, and of course, it needs suitable testing.
